Oregon AG Rayfield Challenges NHTSA Fuel Economy Rollback

• Oregon Attorney General Dan Rayfield has filed a lawsuit challenging the National Highway Traffic Safety Administration's (NHTSA) rollback of federal fuel efficiency standards.
• The legal action, brought in the U.S. Court of Appeals for the First Circuit, argues that the Trump Administration's new rules violate federal law and disregard NHTSA's congressional mandate.
• NHTSA's revised standards weaken fuel economy requirements by removing electric vehicles from its calculation, allowing automakers to sell less efficient cars and trucks.
• This change is projected to result in higher fuel costs for consumers, increased air pollution, and a lower efficiency bar for new vehicles compared to those from 2021.
• A broad coalition of attorneys general from 20 states, the District of Columbia, and several major cities has joined Oregon in challenging these weakened standards.

The administration's actions, according to Attorney General Rayfield, would impose billions of dollars in costs on families and small businesses, exacerbate air pollution, and contribute to more severe summer temperatures.

Oregon Attorney General Dan Rayfield has initiated legal proceedings to contest a new rule from the Trump Administration that significantly weakens federal fuel efficiency standards. This action, taken alongside a broad coalition of attorneys general from multiple states and cities, targets the National Highway Traffic Safety Administration (NHTSA) for its decision to permit automotive manufacturers to produce and sell vehicles with lower fuel economy.

The lawsuit was formally filed in the U.S. Court of Appeals for the First Circuit. The plaintiffs argue that NHTSA's revised regulations are in direct contravention of existing federal law and that the agency has failed to uphold the responsibilities explicitly assigned to it by Congress. The core contention is that these changes will lead to increased costs for consumers at the gas pump, among other negative consequences.

For nearly five decades, federal fuel economy standards have served a critical function: mandating that new vehicles achieve greater distances on a single gallon of gasoline. This regulatory framework, established by a 1975 federal fuel economy law, was designed to ensure that the federal government set achievable efficiency benchmarks for automakers. Traditionally, NHTSA determined these standards by evaluating the performance of vehicles already on the road to establish realistic targets for new models.

These long-standing standards have delivered substantial benefits, including financial savings for families, greater stability in gas prices, reduced susceptibility to international oil price fluctuations, and a decrease in overall pollution levels. The current legal challenge underscores the importance of these historical protections and the potential ramifications of their erosion.

The National Highway Traffic Safety Administration's recent modifications to its calculation methodology are at the heart of the dispute. Specifically, NHTSA has opted to exclude electric vehicles from its efficiency calculations, a change that effectively lowers the bar for compliance. As a result, for the next five years, new cars will be subject to less stringent fuel efficiency requirements than those that were already in circulation in 2021.

Attorney General Rayfield voiced strong concerns, stating that the administration's actions would impose billions of dollars in costs on families and small businesses, exacerbate air pollution, and contribute to more severe summer temperatures. The multi-state coalition joining Oregon in this lawsuit includes Arizona, California, Colorado, Connecticut, Delaware, Hawai‘i, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Carolina, Rhode Island, Vermont, Washington, Wisconsin, the District of Columbia, and the cities of Chicago, Denver, New York, and San Francisco, highlighting the widespread concern over the projected higher fuel costs for drivers and worsening climate impacts.

Lawyers advising automotive manufacturers or related industries should monitor this multi-state lawsuit challenging the NHTSA's weakened fuel economy standards, as its outcome could reinstate stricter compliance obligations for vehicle emissions and fuel efficiency, impacting product development and market strategy.

Source: Reporting based on Oregon Department of Justice statements.